the April 2009 Issue in PDF Format - Trade Show Executive

Special Report
Private Equity in Tight Times
By Renee Diiulio, senior editor, news & directories
Carlsbad, CA - Like the rest of the
economic markets, private equity is in
a state of flux. As credit markets have
tightened, private equity firms have
also found it difficult to arrange debt
financing and have had to rely on more
liquid forms of capital. As a result, target
investments have shrunk and investment
criteria have become more selective.
In turn, companies pursuing private
equity financing have become more
cautious, seeking assurance that the
investing firm has the credit to support
the deal as well as the intention to
support the company. Deals that
have ended badly for the company
receiving private equity money are
easily found in the media.
While private equity
is often thought of as a
Out of the Vault.
Private equity money is
still available but P.E.
firms are more cautious.
savior for companies during a recession,
it is more often a strong contributor
to economic growth. Private equity
investments offer a company the
resources to expand or repair its
business. The result can stimulate
innovation, job creation and workflow,
and management efficiencies.
Due Diligence
Before the money is handed over,
however, companies have to prove they
are worth the investment, a task that
is more challenging in tight economic
times. Private equity firms often have a
set of criteria for companies in which
they will invest. Sometimes these
requirements are flexible, but parameters
are often created to match a firm’s
resources and expertise.
Financial criteria can include revenue,
EBIDTA [Earnings Before Interest,
Taxes, Depreciation and Amortization]
and investment size. Market position,
management philosophies, business
models, geographic headquarters and
performance records may also have to
meet specific requirements.
For instance, some funds are
restricted to European companies; others
to those in North America; while others
have an international portfolio. Some
private equity firms prefer industry
leaders; other firms work with midmarket
companies. Some firms may ask
managers to invest their own money.
Show organizers should be prepared
to undergo rigorous due diligence.
Today’s economy has forced investors to
become very cautious about what they
do with their money.
Identifying Firms
To help identify potential private
equity investors, Trade Show Executive
has gathered information on nearly 30
private equity firms that have expressed
an interest in or have shown a historical
interest in the media sector. They offer
a broad spectrum of products designed
for a variety of business models and may
help a company move to the next level.
36 April 2009 Trade Show Executive www.TradeShowExecutive.com